Prove It Act of 2024

Received in the Senate.

Dec 9, 2024

The Prove It Act of 2024 expands federal agency rulemaking requirements related to small businesses, organizations, and governmental jurisdictions. When conducting initial regulatory flexibility analyses, agencies must include reasonably foreseeable indirect costs on small entities where feasible. When agencies certify that a rule will not have significant economic impact on small entities, they must provide this certification to the Small Business Administration's Office of Advocacy within 10 days, and small entities may petition for review. If the Office of Advocacy determines upon full review that a rule would have significant economic impact on small entities and the agency does not participate in the review, the rule cannot apply to those small entities. Agencies must also publish and accept comments on guidance documents for rules likely to have significant economic impact on small entities.

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Prove It Act of 2024 This bill expands the requirements for federal agency rulemaking with respect to small businesses, organizations, and governmental jurisdictions. Specifically, when conducting an initial regulatory flexibility analysis, agencies must include, where feasible, any reasonably foreseeable potential indirect costs the proposed rule may impose on such small entities. Further, if an agency certifies that an initial regulatory flexibility analysis is not required because the rule will not have a significant economic impact on a substantial number of small entities, the agency must provide such certification within 10 days to the Office of Advocacy of the Small Business Administration. A small entity or group of small entities may petition the Office of Advocacy to review such certification. The petition must include specified information, such as the issues the petitioner believes should be addressed and a proposed solution to the issues raised. If the Office of Advocacy ultimately determines, upon a full review of the petition, that the proposed rule would have a significant economic impact on a substantial number of small entities, the agency promulgating the rule must perform an initial and final regulatory flexibility analysis for the rule. Additionally, if the agency does not participate or assist in the full review process, the finalized rule shall not apply to small entities. The bill also requires agencies to publish, and allow for comments on, all guidance documents with respect to any rule an agency determines is likely to have a significant economic impact on a substantial number of small entities.